(B) THE RECOGNIZED HEADS OF UNDUE PRESSURE
There are three particular circumstances where restitution is available on the ground of undue pressure. Although the threats which are involved in these cases relate to lawful activity, the development of the law of tort may mean that some cases which were once characterized as involving undue pressure would today be treated as economic duress, because the defendant’s threats relate to what is now an unlawful tortious act.[1]
The claimant will not be able to establish undue pressure in any ofthese cases ifthe benefit which the defendant demanded from the claimant was lawfully due to the defendant,[2] since there will then be a legal basis for the defendant’s receipt of the enrichment.
(i) Threats to Invoke the Criminal Process
Where the defendant has threatened to prosecute the claimant or a relative of the claimant and, as a result of this, the claimant has paid money to the defendant or entered into a contract with him or her, the money can be recovered or the contract set aside on the ground of undue pressure. Although the cases which can be used to illustrate this ground of restitution tend to refer to the ground being either duress or undue influence, the better view is that the ground of restitution is that of undue pressure because the threat will tend to be lawful, since it is generally clear that the person who might be prosecuted has committed a crime.
The application of undue pressure in this context is illustrated by Williams v Bayley,[3] where the defendant bankers procured the claimant to execute an equitable mortgage of his property, by threatening that, if he failed to do so, they would prosecute his son for forgery with the morally certain consequence of the son being transported for life. The mortgage was set aside because of the pressure applied by the defendant. As Lord Chelmsford said, Equity would set aside an agreement ‘where there is inequality between the parties, and one of them takes unfair advantage of the situation of the other, and uses undue influence to force an agreement from him’.[4] Despite the express reference to undue influence, this case is still better treated as one involving undue pressure because the defendant had induced the claimant to enter into the mortgage as a result of a threat, albeit a lawful one.[5] Similarly, in Mutual Finance Ltd v John Wetton and Sons Ltd[6] a guarantee had been entered into by the defendant company for the benefit of the claimant as a result of the threats made by the claimant that it would prosecute the brother of one of the directors of the defendant company for forgery. This director signed the guarantee on behalf of the defendant because he feared that, if his sick father found out about the forgery, the shock might kill him. The judge set aside the guarantee specifically because the claimant’s conduct amounted to undue influence in Equity, but again a lawful threat had been made. In this case it was recognized that the facts were not sufficient to establish duress at Common Law, because the threats in each case were lawful,[7] but this did not prevent the intervention of Equity.
It does not matter what the relationship is between the person who entered into the contract or paid the money and the person who is liable to be prosecuted. Essentially the only question before the court is whether the pressure exerted by the defendant caused a contract to be made or money to be paid. In Mutual Finance Ltd v John Wetton and Sons Ltd[8] Porter J held that the doctrine ‘extended to any case where the persons entering into the undertaking were in substance influenced by the desire to prevent the prosecution or possibility of prosecution of the person implicated, and were known and intended to have been so influenced by the person in whose favour the undertaking was given’. This notion of substantial influence by the pressure suggests that it is sufficient that the pressure was a contributory cause of the claimant’s actions, without needing to be a ‘but for’ cause of those actions. This lower threshold for establishing causation might be justified on the ground that the equitable doctrine of undue pressure will only be established where the defendant’s conduct can be characterized as unconscionable.
- [1] Particularly following the recognition and development of the tort of intimidation.
- [2] Flower v Sadler (1882) 10 QBD 572; Mutual Finance Ltd v John Wetton and Sons Ltd [1937] 2 KB 389.See Chapter 7.
- [3] (1866) LR 1 HL 200. See also Kaufman v Gerson [1904] 1 KB 591 and Societe des Hotels Reunis v Hawker
- [4] (1913) 29 TLR 5 78. 165 Williams v Bayley (1866) LR 1 HL 200, 216.
- [5] Although the actual receipt of money in return for the agreement not to disclose material informationrelating to a serious offence is a crime (see the Criminal Law Act 1967, s 5(1)), the threat to disclose theinformation is not unlawful.
- [6] [1937] 2 KB 389.
- [7] Ibid, 395 (Porter J). 169 Ibid, 396. 170 Williams v Bayley (1866) LR 1 HL 200.
- [8] 171 See Mason v New South Wales (1959) 102 CLR 108, 144 (Windeyer J). See also Woolwich Equitable
